The latest figure from the Central Bank of Nigeria showed that the currency in circulation has risen from ₦58.36bn to ₦2.84tn in September.
According to the CBN, the rise in broad money supply was largely driven by the growth of net foreign assets and net domestic assets by 12.35 and 4.30 per cent respectively in August 2021, compared to 1.84 and 3.17per cent in July.
The apex bank disclosed that the growth was driven by an increase in foreign asset holdings of commercial and merchant banks.
In the money market, the monthly weighted average interbank call and open buyback rates increased to 13.45 and 12.97 percent. This, reflected the tight liquidity conditions in the banking system during the reviewed period as the bank controlled excess liquidity.
To track the movements of currency in circulation on a transaction basis, The CBN said it employed the accounting, statistical, withdrawal and deposit approach to compute the currency in circulation in the country.Transactions are recorded in the CBN’s CIC account, and the balance on the account at any point in time represents the currency in circulation.